hurricane

Hurricane Michael has strengthened once again, becoming a major Category 4 storm with 155 mph sustained winds and higher gusts and is forecast to make landfall in Florida in the coming hours as an extremely dangerous storm, with experts warning of a life threatening situation from winds and storm surge.

The precise location where hurricane Michael makes its expected Category 4 landfall today will have a significant bearing on the potential for ILS impacts, according to Twelve Capital, who also estimated on a stochastic basis that the eventual industry loss could be $5 billion to as much as $15 billion.

A more intense now Category 4 hurricane Michael with 145 mph sustained winds and higher gusts means a potential doubling in the economic impacts caused by the storms surge and wind damage to around $16 billion, according to new simulated model runs.

Catastrophe risk modelling firm RMS has highlighted some key differences between hurricane Michael, which is heading for the Florida coast and expected to be a major category storm at landfall, with recent hurricane Florence.

The main Floridian primary insurers as well as some of the largest national U.S. insurance firms are among the most exposed to the impacts of hurricane Michael, according to A.M. Best data.

Catastrophe risk modelling firm Corelogic has released an early estimate of property reconstruction values that are exposed to the storm surge from hurricane Michael as it threatens a major hurricane category landfall in the Florida Gulf Coast region.

Differences between estimates are again evident in the catastrophe risk modelling space, as Corelogic delivers a figure for hurricane Florence’s flood insurance industry losses that suggests the NFIP’s flood reinsurance program is still in the frame to be triggered.

The insurance and reinsurance market-wide loss from recent hurricane Florence’s impacts in the Carolina’s and surrounding region of the United States is expected to be in a range from $2.8 billion to as much as $5 billion and this is including an NFIP flood insurance claims estimate.

Collateralized reinsurance quota shares and retrocessional protections that sit in lower layers of cedant’s towers are the most likely source of ILS market losses from hurricane Florence, according to rating agency Fitch.

Valuations of some of the listed and mutual insurance-linked securities (ILS) fund strategies have stabilised or even begun to recover after hurricane Florence’s impacts proved to be less severe to ILS investments than had initially been anticipated.